Wall Street Warns S&P 500 Dip Buyers of More Turbulence Ahead

Wall Street strategists have a warning for dip buyers tempted by Friday’s rout in US stocks: There could be more pain ahead, even as China and the United States are signaling openness to trade talks.

The S&P 500 Index gained 1.6% on Monday, recouping more than half of its Friday losses triggered by rekindling tariff tensions. But to market watchers at firms including Morgan Stanley, Evercore ISI and JPMorgan Chase & Co., stocks are due for skittishness, at least in the short-term, with lofty valuations adding to potential economic damage from the US government shutdown and trade uncertainty. The benchmark gauge was down 0.6% at 10:31 a.m. in New York on Tuesday.